Nobel Peace Prize winner Muhammad Yunus spoke Friday at this year’s Westmont President’s Breakfast to a full room of faculty, sponsors and students at the Fess Parker Doubletree resort.
In his hour-long speech that shares its title with one of his books — “Creating a World without Poverty: Social Business and the Future of Capitalism” — professor Yunus talked about how he started the Grameen Bank and the business of micro-loans in his native Bangladesh, his numerous other projects, and his philosophy of a kinder, less rapacious capitalism.
He also joked that he was “The Rainmaker,” having brought weather typical of his country to drought-stricken California.
The President’s Breakfast and its Westmont Leadership Award began in 2006, with honorees ranging from Fareed Zakaria and Walter Isaacson to Condoleezza Rice and Gen. Colin Powell. Friday’s early morning affair began with three songs from the Westmont College Choir, introductions from the college’s chair John Ambrecht, event chair John Davies, college President and an invocation from Father John Love of Saint Mark’s University Parish.
Several of the sponsors of the event were local banks, which amused the visiting professor.
“I am being honored by bankers, when I’ve spent my life arguing with them.”
Mr. Yunus spoke of his time spent in higher education in the U.S. during the late 1960s, and seeing the great social upheavals of that time. When he returned to Bangladesh with his doctorate, he said, “all my knowledge meant nothing, when people were dying outside the door of my classroom.”
His desire to do something was not pre-planned, he said, it was “an action of desperation.” But his example was the backbone of his talk to the many students in attendance. He wanted people to “solve a tiny piece of the puzzle” because that creates a “seed” that will grow and solve more problems. His tiny solution was to lend poor people near him money, something the banks would not do.
He also wanted to undercut the loan sharks who were making profit off people with no money. His first loan, he remembered, was $27, split among 42 people. It didn’t sound like much, but to the poor it was a lot, and they paid him back. After eight months arguing with bankers, he agreed to be the loan guarantor between the poor and the bank.
This evolved into Grameen Bank — “village bank” — the first micro-loan bank for villagers, run by villagers.
In one of the tenets that stuck with many of the audience members, he recalled how he studied banking, and “once I learned how to do it, I did the opposite,” he said. Banks in Bangladesh only loaned to men; he loaned to women. People went to regular banks; his bank went to the people. Poor people have no collateral, so the Grameen Bank does not require it.
There is no paperwork, and therefore, no lawyers — this received a knowing laugh from the audience.
The ability to go against pre-conceived ideas, he said, is difficult and not in our nature. Directly addressing Westmont, he said “College should not be a place where you seal off knowledge.” Everything should be questioned.
For helping millions out of poverty, Mr. Yunus and the bank jointly were awarded the Nobel Peace Prize in 2006.
A year later, he tried to start a political party, which did not go over well with the ruling party. The professor was sacked, and he fought back, setting in motion a legal battle that didn’t end until 2011, when he resigned.
Grameen Bank remains, doing its work.
Mr. Yunus expanded his system first to Asia and then to some of the poorest places in “the richest country in the world” — our own. The latest bank is in Boyle Heights in Los Angeles.
The formula is not culturally dependent, he said.
The question is not if people are bank-worthy, but “are banks people worthy?” he asked.
“Credit is a human right.”
The banks and small businesses he has helped set up are designed to be self-sustaining and perpetuating, not to make anybody a massive profit. He also said he appreciated philanthropy, but noted that it can often be a “one-time thing” with dependent agencies having to raise money every year.
Mr. Yunus’ business ideas have come one after the other, helping bring farmed food to Haiti when it was importing everything; opening clinics focusing on cataract surgery; teaming with Dannon yogurt to produce a vitamin and nutrient filled yogurt just for Bangladeshi children; working with Japanese clothing company Uniqlo to bring sanitary napkins to the women of Bangladesh.
The professor made these ideas sound both radical and obvious at the same time.
He spoke about rethinking capitalism, where “making money is not the only incentive.” The other, he said, is to increase happiness, and our own happiness increases when we help others.
Humans are both selfish and selfless, he noted, adding “we are not money making robots.”